Watch TV.
One of the most compelling things I’ve read lately is “TV’s Untapped Potential as a Digital Business,” David Cooperstein’s recent post on Forbes.com. While he makes some really insightful recommendations about TV’s need for digital innovation – updating the ratings currency, speeding decision and switching times and integrating more easily with the ‘rest of the industry’ – Cooperstein ultimately serves us best by laying waste to the anachronistic notion of some kind digital victory over the dark forces of TV. “..You have to add up a lot of digital pieces to begin to approach the size of the TV ecosystem today, and TV keeps growing,” he points out, adding that TV moves a lot of money and attention “…at far greater scale, and with a lot less effort.”
This week’s Drift is proudly underwritten by Bionic Advertising Systems, an advertising technology company focused on delivering innovative software that streamlines and automates media workflow for marketers, their advertising agencies, and publishers.
To some, this may sound like a recipe for inertia and another decade of running out the clock on a TV-buying model that serves agencies and broadcasters pretty well. But I think the real story is far more complex, challenging and interesting. I don’t consider myself an expert, but based on all I’m seeing and hearing, the next five years should see a virtual renaissance in the TV/Video ecosystem. But in order to see it all clearly and fully participate, it’s important to reconsider a few big ideas.
- Broadcast and Cable TV can become more digital without walking away from their core economics. Look for the kind of innovations Cooperstein notes in the article to help update TV’s economic infrastructure.
- Addressability and data-driven buying are crossing the line. Set top box data from cable MSOs and satellite companies is already starting to be used to drive addressable and enhanced TV buys. If you’re wondering why AT&T bought DirecTV, the answer is in here.
- TV is not one business, but several. Those in the digital trenches love to ball up our fists and talk about “TV,” but what exactly are we talking about? National broadcast? Syndication? Local? Basic Cable? “TV” is like Yugoslavia: an artificial patchwork of different tribes and beliefs. Just add many more layers of new complexity and scores of new players to the business.
- Video is bigger than TV. The desire for professional video content is bottomless. And it’s going to be enough to support a lot of niche content and distribution businesses. There will always be consolidation of power and dollars (the next Viacom, Google and NBC will probably be Viacom, Google and NBC) but innovation and riches have always grown in the margins.
- Scarcity vs. Abundance is the real fulcrum. I’ve always thought that what truly separated “TV” and “digital” was the portion of supply that could be controlled. So far, broadcasters and agencies have done a good job of using scarcity and control to keep a profitable model thriving. We’ll see how it goes from here.
It’s still early. And man is it going to get interesting.
This is the most insightful, humble, and in my opinion, accurate picture of what is to develop in the TV spectrum in the coming years. There are a lot of smart people working on what a synergistic TV/Digital landscape will mean and no one in that space made their billions by resting on their laurels. In 1998 the marching cry was that the :30 spot would be dead in 5 years. That was as a ridiculous statement then as saying TV is a dying medium today. Technology outpaces our predictions so often that making a bold statement about the future, without the humility of caveats and what ifs, is insane (history repeating itself, etc). We know now that there are clearly plenty of media consumption and media spends to support the growth across all mediums so the solution will no doubt be a convergence of the best properties of each. Thanks as always, Doug.
-td
Doug is right on as usual. I laugh when I hear some digital folks forecast the coming total collapse of the TV industry. This is not going to happen. As someone who advised TV companies the first half my career, I recognized some of the unique attributes this sector possesses that bring it more sustainability.
Which is not to say its not going to change. Big changes are coming as TV is delivered over IP and TV and the distinctions between linear TV and digital video diminish. Needless to say the analysis is much more nuanced. I tried to capture some of the issues in our recent deck “The Future of (Digital) TV” available on slideshare here: http://www.slideshare.net/tkawaja/lumas-the-future-of-digital-tv. Based on the popularity of a write-up on Business Insider (250,000 views in 3 days), this topic seems to be interesting many (http://www.businessinsider.com/luma-partners-on-the-future-of-tv-2014-7?op=1).
[…] In this week's Drift column, Doug Weaver predicts a virtual renaissance in the TV/video ecosystem based on a handful of considerations. TV is not one business, he suggests, but several, and each division's approach to digital differs. Weaver opines, "I’ve always thought that what truly separated ‘TV’ and ‘digital’ was the portion of supply that could be controlled. So far, broadcasters and agencies have done a good job of using scarcity and control to keep a profitable model thriving.” Read on. […]